Tips for Managing Multiple Credit Cards
Studies have shown that the average American has more than one credit card. Unfortunately, studies also show that the average American is in some form of credit card debt.
However, this doesn’t necessarily mean that there is a correlation between carrying multiple credit cards and being in debt. With proper management it is possible to reap great benefits from owning multiple cards, especially for people who like to travel, purchase items online, and shop at particular stores using special merchant credit cards.
The following tips can help anyone manage multiple credit cards, stay out of debt, and experience all of the advantages of having different cards for different uses.
Consolidating Balances
Although having multiple cards can be beneficial, it can be a hassle to manage more than three credit card balances simultaneously. Fortunately, it is possible to set up balance transfers from one credit account to another to minimize the number of payments that must be made.
When executing a balance transfer, it is best to consolidate as much of the debt as possible to the card with the lowest interest rate. Having all of the balances on one or two credit cards is much more convenient and manageable than having to pay 5 to 10 different credit card bills each month.
Missing a payment can prove to be disastrous if the credit card company is participating in the Universal Default Policy. Under UDP guidelines all credit card companies can raise an individual’s interest rates in the event of a single payment default, even if the card is not related to the penalized credit account. In other words, missing a payment for one credit card could cause all other credit cards to have a higher interest rate, as well.
Managing Due Dates
Properly scheduling payments and adhering to several due dates each month can be an unnecessarily difficult task, especially if each card has a different due date. Fortunately solving this problem is as simple as calling the customer service department of the credit card company. Most credit card companies are flexible with due dates and will work with their clients to create a comfortable billing schedule. It is very important to make sure all credit cards have coordinated due dates at the same time each month to prevent inadvertent missed payments and unnecessary late penalties.
Automatic Transfers and Online Payments
After the above steps have been taken, it is ideal to set up an automatic transfer from a bank account to the credit accounts. Not only with this help with budgeting, it will also eliminate most of the hassle that is associated with paying credit card bills.
But for individuals who want a convenient payment solution and don’t always have enough in their bank account to fund the credit card payments each month, it may be more practical to issue online payments. Payments can be scheduled through the online banking interface automatically, or the cardholder can issue payments at will.
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